Crypto News Roundup ( 10th December to 15th December 2023)

Crypto News Roundup ( 10th December to 15th December 2023)
Here are the top stories that happened in crypto this week.
  • Paxos Report Highlights Financial Companies' Significant Interest in Cryptocurrency
  • JP Morgan Predicts Ethereum May Outperform Bitcoin in 2024, But Cautions on Crypto Market
  • Angolan Parliament Approves Landmark Cryptocurrency Regulation Bill
  • Ghana's SEC Takes Strides Towards Cryptocurrency Regulation with Newly Formed Task Force

Paxos Report Highlights Financial Companies' Significant Interest in Cryptocurrency

paxos logo on a screen

According to a recent report by crypto company Paxos, almost all (99%) of the U.S. financial services companies they surveyed are more interested in crypto projects this year compared to before.

The survey surveyed 400 executives from American financial institutions that have at least five million users and either $50 billion in assets under management or $50 billion in annual payment volume.

Even though these companies are excited about using crypto, the report also pointed out several challenges they are facing. A big problem, according to 56% of the people surveyed, is how complicated it is to set up crypto solutions.

Paxos emphasised that digital assets and blockchain technology are strong and can handle market changes, economic uncertainties, and the need for clearer regulations. The report suggested that companies are starting to see the long-term value in these technologies.

Market changes worried 51% of the people surveyed, making it a big obstacle for moving forward with crypto and blockchain projects in their companies.

Additionally, 43% mentioned the high costs of using crypto as another challenge. Despite these issues, the report showed that less than 2% of those surveyed thought that not believing in the benefits of blockchain was a problem.

JP Morgan Predicts Ethereum May Outperform Bitcoin in 2024, But Cautions on Crypto Market

JP Morgan's analysts are being cautious about the crypto market in 2024, putting a damper on hopes for a big surge in cryptocurrency prices. The bank's experts, led by Nikolaos Panigirtzoglou, explained in a recent report that they are not expecting a significant increase in crypto values next year.

According to the report, the impact of the Bitcoin halving event is already factored into the current Bitcoin price. The analysts believe that the predictable nature of the halving and its effect on the Bitcoin supply is well considered in the current value of Bitcoin. They pointed out that based on the current Bitcoin hash rate and mining difficulty, the cost for miners would double from around $22,000 to about $44,000 after the halving.

The report suggests that Bitcoin's current price, approximately $42,000, indicates a conservative estimate of a 5% drop in the hash rate after the halving. However, the analysts anticipate a more significant 20% drop in the hash rate, with miners facing higher costs leaving the market.

JP Morgan's report also mentions Ethereum as a potential performer in 2024, highlighting the "Protodanksharding" upgrade. However, it raises concerns about the concentration of staking on the Ethereum network.

While the report acknowledges the rise of new DeFi chains like Aptos, SUI, and Pulsechain, it advises against getting too excited about a DeFi and NFT revival at this stage.

The analysts are sceptical about the expected approval of a spot Bitcoin ETF, suggesting that it might not attract fresh capital to the market. They cite the lack of interest in already-approved spot ETFs in Canada and Europe and anticipate that capital might move from existing Bitcoin products to spot Bitcoin ETFs, potentially causing a significant drop in Bitcoin prices.

Angolan Parliament Approves Landmark Cryptocurrency Regulation Bill

In a significant development, the Angolan parliament has officially passed a comprehensive bill aimed at regulating virtual assets and cryptocurrency mining. The bill, initially announced by Angolan authorities in August, has now gained unanimous approval from 167 members of parliament.

Sponsored by the office of the president of Angola, the legislation consists of five key sections addressing critical aspects such as the issuance and circulation of cryptocurrencies, offences related to the country's energy system, and the overall regulation of crypto activities.

Otoniel dos Santos, Angola’s secretary of state for finance and treasury, highlighted the bill's primary objective as protecting the interests of Angolan citizens. He emphasised that the law is a response to past incidents that posed threats to the country’s environmental stability and energy security.

Dos Santos stated, “The [legal] instrument also proposes to prevent, in a general way, within the framework of criminal policy, conduct that jeopardises national monetary sovereignty and also to protect the energy and environmental systems.”

Of particular note is the bill's focus on combating issues such as money laundering and terrorist financing often associated with private cryptocurrencies.

Despite the groundbreaking nature of this regulation, the exact date of its implementation remains unclear at this time.

In a related context, the president's office had previously proposed a bill in August to ban cryptocurrency mining and restrict the circulation of digital assets not issued by the country’s central bank. The bill also aimed to bring virtual assets under the purview of the Capital Markets Commission (CMC).

It's noteworthy that while cryptocurrencies are not illegal in Angola, authorities have cautioned against transactions involving them, even going so far as to restrict financial institutions from dealing with this asset class.

Angola currently witnesses a notable level of Bitcoin mining compared to other African nations, raising environmental and energy consumption concerns.

Earlier this year, the Criminal Investigation Service in Angola detained several Chinese nationals for mining crypto from a camouflaged brick factory.

Ghana's SEC Takes Strides Towards Cryptocurrency Regulation with Newly Formed Task Force

Ghana's Securities and Exchange Commission (SEC) has revealed its plans to introduce cryptocurrency regulations, marking a pivotal moment in the country's approach to the digital asset landscape.

The SEC has taken proactive measures by initiating a dedicated task force aimed at enhancing its expertise and understanding of cryptocurrencies. This strategic move is seen as a crucial step toward formulating a comprehensive regulatory framework to govern the rapidly evolving digital asset space.

Daniel Ogbamey-Tetteh, the director-general of the commission, unveiled this development during the 2023 Ghana capital market conference, coinciding with its 25th-anniversary celebration. Ogbamey-Tetteh explained that the SEC's decision aligns with directives from the International Organization of Securities Commissions (IOSCO), of which Ghana is a signatory.

The IOSCO encourages its members to stay informed about crypto assets to safeguard investor interests. In response, the SEC has commissioned a task force to bolster its regulatory capacity in the digital asset domain. However, specific details about the task force's members and the scope of its work were not disclosed.

Ogbamey-Tetteh emphasised the importance of this move, stating, “We are in the era of digital assets – and taking a cue from IOSCO... we have commissioned a task force to assist the Commission to acquire requisite capacity in that space.”

This development comes at a time when regulators globally have faced criticism for lacking a comprehensive understanding of digital assets due to the novel nature of the technology. The SEC's proactive stance with the task force signals a commitment to bridging the knowledge gap and preparing for effective regulations in the dynamic crypto space.

It's important to note that cryptocurrencies are presently prohibited in Ghana, with authorities instructing financial institutions not to engage in crypto-related transactions. This move by the SEC reflects a broader trend across African countries, each navigating diverse regulatory approaches to digital assets.

Disclaimer:  The information provided in this crypto news round-up is for informational purposes only and should not be considered financial or investment advice. Obiex will not be held liable for your investment decisions.